Bond ETFs News:

Investors continue to embrace risk and yield before Thursday’s highly anticipated Federal Reserve announcement. High-yield ETFs are breaking out again with junk bond yields dropping to record lows.

“The early September pre-FOMC risk-on rally continues to push the junk-bond market to improbable heights, with the average junk-bond yield falling below 6.5% for the first time ever,” writes Michael Aneiro for Barron’s.

SPDR Barclays Capital High Yield Bond (NYSEArca: JNK) and iShares iBoxx High Yield Corporate Bond (NYSEArca: HYG) are the largest junk bond ETFs. Both funds were trading at 52-week highs on Wednesday. [A Tale of Two High-Yield ETFs]

HYG is breaking through resistance that had been in place for more than a year, according to Bespoke Investment Group. “With the resistance out of the way and now acting as support, the technicals certainly look strong for junk bonds,” the firm notes.

The opinions and forecasts expressed herein are solely those of John Spence, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.